Council votes to send 3% lodging tax increase question to Springfield voters

Springfield City Council voted last night to approve a one-reading bill that will put a 3% lodging tax increase question on the Nov. 4 ballot.

The city will ask voters this fall whether tourism taxpayers should help fund a $175 million downtown convention center. Along with a $209 million hotel complex that could be built near the proposed convention center, the proposed project could drive $1.3 billion in new visitor spending – and $68.7 million in net fiscal impact – over the 30 years following construction. That’s according to a consultant’s report commissioned by Visit Springfield, Missouri and presented to council earlier this month. 

Yesterday’s vote on the special tax proposition ordinance was 8-0. Zone 3 Councilmember Brandon Jenson was absent from the meeting.

According to the council bill text, the proposition for eligible Springfield voters this fall will read:

“Shall the City of Springfield, Missouri, impose an additional three percent (3%) license tax on the business of renting, leasing, or letting living quarters, sleeping accommodations, rooms, or a part thereof, in connection with any hotel, motel, tourist court, or short-term rental, derived from or paid by transient guests for sleeping accommodations for the purpose of attracting travel and tourism, including the construction of a regional convention and event center?”

For more than two decades, the city’s lodging tax has been set at 5%, after voters authorized increases to the original 1979 tax, in 1998 and 2004.

If voters approve the question in the special ordinance adopted Monday night, Springfield’s lodging tax on hotel rooms, short-term rentals and other places where “transient guests” stay for less than a month will total 8%.

Springfield’s effective tax rate on temporary lodging would climb to 16.1%, up from 13.1% today. City officials say that's lower than similar guest license taxes in cities like St. Louis (17.93%) and Kansas City (16.48% plus $3 per room per night).

Council’s move follows state government actions this spring. With House Bill 7, Jefferson City lawmakers earlier this year approved $30 million in state funding toward a “regional convention center complex” for Springfield. But on June 30, Missouri Gov. Mike Kehoe restricted the funding along with 31 other state spending restrictions. While the restriction isn’t a veto, it means Kehoe can release the funding when he chooses. 

City officials have emphasized their view that timing is important in getting the governor’s thumbs-up for taxpayer convention funding.

“A critical driver of the city’s timing is the opportunity to secure $30 million in state funding for the event center project, currently on a state withhold list pending stability of state revenues and demonstration of a local $30 million dollar match and project readiness,” city officials said in a news release issued shortly after council’s vote last night.

Several speakers turned out for the public hearing ahead of the vote, among them Tracy Kimberlin, former director of the Springfield Convention & Visitors Bureau, now called Visit Springfield, Missouri.

“This is a demand generator that we do need for Springfield, Missouri, that will help the hotels, even though some of them may think the opposite of that,” Kimberlin said.

Kimberlin said he worked some 30 years of his career trying to get a convention center going in Springfield. He credited the recent work of Missouri state Sen. Lincoln Hough, R-Springfield, and Kehoe’s reported support for a convention center.

Of the $30 million state funding at stake, Kimberlin said, “That's a heck of a carrot to dangle out there to get this project going.”

Another supporter, Sean FitzGibbons, executive director of the History Museum on the Square, told council that adopting the guest license tax increase would be a “bold” move.

“It shows that we’re thinking ahead,” FitzGibbons said. “We’re willing to lead with vision, not just maintenance.”

Eric Pauly, a member of the Planning & Zoning Commission and former council candidate, told council he wasn’t there to discuss the pros and cons of a convention center or a potential location downtown.

But Pauly expressed concern about reports that the three-quarter -cent tax revenue approved by city voters in November 2024 might go toward the proposed convention center’s funding stack.

Last year, Pauly was a member of the 30-member Citizens’ Commission on Community Investment that developed the tax proposal, dubbed Spring Forward SGF by city officials.

“We have approached the voters of Springfield with this promise, of this is where the money is going to go to, within the community itself, and it wasn’t actually intended to go to a convention center during any of those discussions that we had,” Pauly said last night.

According to the commission’s final report from June 24 that recommended action to council, a quarter cent of the Spring Forward SGF tax should have gone toward public safety efforts, while a half-cent should have gone toward “additional public initiatives, recreation and investing in the next generation.”

As approved by voters, the half-cent portion of the tax sunsets after 10 years; city officials estimate it will generate roughly $30 million per year.